Booker Group’s strategic focus on improving “choice, price, service” and broadening its business has allowed it to post first-half sales and profits gains ahead of the overall market, a retail analyst observed.
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The UK cash and carry company this morning (13 October) posted pre-tax profit for the 24 weeks to 11 September of GBP29.7m (US$46.9m), up 12.1%, on sales of GBP1.6bn, up 7.7%.
According to Singer Capital Markets retail analyst Matthew McEachran, the group’s increased sales were driven both by increased existing customer spending and the attraction of new customers, which has been achieved through the group’s core strategy to improve choice, price and service.
The company has looked to improve its store base by converting existing outlets to its Extra format, which offers a “broader range” and “improved environment”. In newly refitted stores, sales gains were 3% above those seen at conventional outlets. McEachran added that evidence of this strategy’s success goes beyond the first year – with additional gains in years two and three “over and above” year one uplift.
Meanwhile, the company’s move to diversify its business also appears to be paying off.
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By GlobalDataInternet sales almost doubled year-on-year, up from GBP96.4m in the comparable period of last year to GBP180.8m in this half.
“Internet enhancements over next six months should drive continued strong growth, including incremental customer numbers,” McEachran observed.
Additionally, Booker said that the performance of its trail store in India was satisfactory. Management confirmed that if it decides to push ahead and expand in the market, it wold likely do so in partnership with a local retailer.
“Overall prospects for the group continue to look compelling,” McEachran concluded.
